Bank is offering ‘top rate’ interest for savers on cash up to £1m

The Bank of England base rate has increased to three percent following the latest rise of 0.75 percentage points in November. In response to the decision, many banks have been passing these savings on giving Britons the chance to earn more for their money.

Union Bank of India (UK) Ltd is offering 4.55 percent interest for 18 months on a fixed rate deposit.

Customers need a minimum of £1,000 in savings and interest is calculated on closing balances at the end of each day and paid annually.

Moneyfacts.co.uk has given this account an “excellent” product rating as the 4.55 percent interest rate places it as a “top rate” pick within in its sector.

Britons are urged to shop around and get the best deals available to them.

READ MORE: Families on Universal Credit to get extra £600 next year – new rates explained

While it’s now possible to get more than five percent interest on savings, these accounts typically require people to lock away savings for a number of years whereas this is just 18 months.

Commenting on the deal, Rachel Springall, Finance Expert at Moneyfacts.co.uk, said: “Now paying a rate of 4.55 percent, the 18 Month Fixed Rate Deposit account sits comfortably within the top rate tables in its sector and may entice savers looking for a guaranteed return over the next 18 months.

“Savers will find early access and further additions are not permitted, so they would be wise to ensure they are satisfied with their initial deposit.

“On assessment, the account receives an Excellent Moneyfacts product rating.”

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For easier access to cash, Britons could choose an easy access account over a fixed term account.

This could be good for storing an emergency fund as it is easily accessible.

Ms Springall continued: “Interest rates have continued to rise across the savings spectrum, and we witnessed nine consecutive months of increases to all average rates for the first time on our records.

“The average easy access rate breached one percent for the first time in over 10 years and fixed rate bonds saw the average shelf life fall to 26 days, the lowest figure seen since 2009.

“These highlights are proof of the positive direction of the cash savings market, with further rises expected due to the Bank of England Base Rate rises.”

While there is a wide range of different savings accounts people can opt into to suit different needs and requirements, easy access savings accounts tend to be one of the simplest of all.

Moneyfacts.com rated Earl Shilton BS’ Progress account top of the list with an Annual Equivalent Rate (AER) of 2.85 percent.

Up to six withdrawals are permitted per year to qualify for the 2.85 percent bonus rate.

If any more withdrawals are made, interest will reduce to 1.8 percent.

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